Double Crowding-Out Effects of Means-Tested Public Provision for Long-Term Care

Christophe Courbage and Peter Zweifel
Additional contact information
Christophe Courbage: The Geneva Association, 53 route de Malagnou, 1208 Geneva, Switzerland
Peter Zweifel: Emeritus, Department of Economics, University of Zurich, Kreuth 371, 9531 Bad Bleiberg, Austria

Risks, 2015, vol. 3, issue 1, 1-16

Abstract: Publicly provided long-term care (LTC) insurance with means-tested benefits is suspected to crowd out either private saving or informal care. This contribution predicts crowding-out effects for both private saving and informal care for policy measures designed to relieve the public purse from LTC expenditure such as more stringent means testing and increased taxation of inheritance. These effects result from the interaction of a parent who decides on the amount of saving in retirement and a caregiver who decides on the effort devoted to informal care which lowers the probability of admission to a nursing home. Double crowding-out effects are also found to be the consequence of exogenous influences, notably a higher opportunity cost of caregiving.

Keywords: long-term care; crowding out; informal care; saving; means testing (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.mdpi.com/2227-9091/3/1/61/pdf (application/pdf)
https://www.mdpi.com/2227-9091/3/1/61/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jrisks:v:3:y:2015:i:1:p:61-76:d:46137

Access Statistics for this article

Risks is currently edited by Mr. Claude Zhang

More articles in Risks from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().